Vietnam Joint Stock Commercial Bank for Industry and Trade or V ietinbank (CTG) said it will increase its capital to more than 37.23 trillion VND (over 1.7 billion USD) by the third quarter.

Vietinbank’s charter capital as of June 30 was 32.66 trillion VND (1.5 billion USD).

The bank will carry out dividend payment in cash at the rate of 16 percent of the charter capital for 2012 prior to the issuance of additional shares to strategic shareholder Bank of Tokyo, Mitsubishi UFJ Ltd (BTMU), BTMU will not receive each dividends for the fiscal year of 2012.

In addition, Vietinbank will issue shares at par value to existing shareholders at a rate of 14 percent of the charter capital (including the issuance to BTMU).

In the plan to increase capital, BTMU will buy more shares to maintain its percentage of ownership in Vietinbank.

After Vietinbank finalises its plan to raise its charter capital, State shareholders will hold 64.46 percent, equivalent to around 24 trillion VND (1.14 billion USD), BTMU will hold 19.73 percent, equivalent to nearly 7.35 trillion VND (346.6 million USD); and other shareholders will hold 15.81 percent or over 5.88 trillion VND (277.3 million USD).

Vietinbank expects to use the additional funding to improve credit, expand its network and invest in technology, new facilities and services while also boosting mergers and acquisitions.

“Increasing capital is the base for our bank to enhance its financial capacity, maintain high growth and create more benefits for shareholders,” said Vietinbank chairman Pham Huy Hung.

During the meeting, Vietinbank also selected two new members of the board: BTMU’s Asia and Oceania director Go Watanabe and corporate client director Hiroyuli Nagata.-VNA